Bernard J. Durkan
Question:71 Mr. Durkan asked the Minister for Public Enterprise the plans she has with regard to the flotation of Aer Lingus or other State or semi-State bodies; and if she will make a statement on the matter. [22790/00]
Written Answers. - Semi-State Bodies.
I have said on several occasions that questions about the future ownership of commercial State companies fall to be determined on a case by case basis in the context of developments in their main business areas. The following is the position in relation to the commercial State companies under my aegis:
The Government authorised me on 14 December 1999 to initiate a process leading to an Initial Public Offering – IPO – of shares in Aer Lingus Group plc and also authorised me to arrange for exploratory discussions with the Aer Lingus unions on increasing the current level of employee share ownership, not to exceed 14.9%.
Since the Government's decision, the Minister for Finance and I have engaged Schroders Salomon Smith Barney and AIB Capital Markets as the joint global co-ordinators for the transaction. Other advisers necessary to facilitate the implementation of the IPO have also been engaged. The Aer Lingus Bill, 2000, to provide the legislative framework to enable the IPO to proceed has been published and has passed Seanad Éireann. The Bill will be considered by Dáil Éireann in due course.
Significant progress has been made on the terms of an increased shareholding for Aer Lingus employees in the context of the IPO. However, some issues remain outstanding which will not be resolved until the current industrial relations difficulties in Aer Lingus have been settled. Indeed, as I indicated to the House earlier this week, it is clear that further progress in relation to the IPO generally cannot take place until those difficulties have been resolved.
I believe that they can and should be resolved speedily, with the assistance of the Labour Relations Commission and the Labour Court. On that basis, I expect that the IPO can take place next spring, subject to satisfactory finalisation of all preparatory work for the IPO and market conditions at the time.
I am continuing to give careful consideration to the findings of the Warburg Dillon Read report on the future strategic direction of Aer Rianta with a view to bringing specific recommendations to Government in this regard as soon as possible.
There are no plans to privatise the IAA, which was incorporated as a commercial State company in 1994 and is the safety regulator and the provider of air navigation services in Irish-controlled airspace.
There are currently no plans with regard to a flotation of Bord na Móna plc.
There are currently no plans with regard to the flotation of ESB. I have, however, written to the chairman of ESB in relation to the future positioning of the company in the liberalised electricity market and I have invited the board to let me have its views on the future direction of ESB including future ownership, alliances and strategic partnerships. The board of ESB discussed this matter at a meeting this week and agreed to consider the matter further in the new year.
There is no current timetable for BGE's privatisation. However, I have written to the chairman of BGE concerning the company's future structure and ownership and I have invited the board to put forward its views on the impact of liberalisation on BGE's structure and related issues such as public-private partnerships and future ownership. The BGE board is still considering these aspects and I would expect to hear from them later in the year.
I should also add that draft legislation is currently being prepared to establish BGE as a pub lic limited company to allow it greater freedom to operate in a liberalised market.
In relation to An Post, the Government has given its approval for that company to initiate negotiations on a strategic alliance with a suitable postal operator in view of the changes in the postal sector in the EU.
However, privatisation is not currently envisaged or planned for An Post.
In regard to the CIE group of companies, the consultation paper entitled A New Institutional and Regulatory Framework for Public Transport published recently by the Government sets out a number of proposals in relation to the restructuring of the CIE companies including the possible privatisation of the bus companies.
Under the terms of the Government's decision of 23 February 1999, INPC initiated an extensive search process to identify business development opportunities to underpin the operation of the Whitegate refinery.
Four definite proposals were submitted to the INPC. The INPC board recommended the submission received from the Tosco Corporation to acquire the refinery and the Whiddy oil terminal. The proposal involves a commitment to operate the facilities in question for a minimum of 15 years. The consultants who are advising me in relation to the proposed deal subsequently endorsed that recommendation.
On 31 July 2000, I announced that I had authorised INPC to enter into a period of exclusive negotiations with the Tosco Corporation for the sale of the refinery and the oil terminal. The National Oil Reserves Agency is not included in the terms of the sale.
Currently, both principals are working to move the initiative forward to a successful conclusion. My Department and the Department of Finance, with the assistance of external consultants, continue to monitor the situation to ensure that shareholder concerns are adequately addressed as the negotiations proceed.